THE RISING ROLE OF CORPORATES

About Our Presenter – Matthew
Wong 2@cbinsights • Senior Research Analyst, CB Insights • Published research and data analysis have been featured in The New York Times, Wall Street Journal, Financial Times, Bloomberg among other major media outlets. • Lead and manage Insurance Tech Insights research and newsletter • TV appearances on Al-Jazeera, Bloomberg TV, and BNN. • Graduate of Northwestern University with B.S., magna cum laude. @mlcwong mwong@cbinsights.com #cbichain

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THE BUSINESS SOCIAL GRAPH The
Business Social Graph lets you visualize the investment, acquisition, competitor, partner & customer relationships between players in a space. It makes mapping and understanding an ecosystem dead simple. The Business Social Graph 14@cbinsights Source: https://www.cbinsights.com/blog/financial-services-bitcoin-investors/ #cbichain

VENTURE CAPITAL INVESTORS ARE TAKING
AN INCREASING INTEREST IN FINTECH Over 220 unique investors in fintech in 2010. Now, there are over 900. Investors see blood. Investors in Fintech: Then and Now 2010 vs. 2010-2015 15@cbinsights @cbinsights Source: https://www.cbinsights.com/business-social-network 2016 YTD #cbichain

GLOBAL BANKING GIANTS PLACE RECORD
NUMBER OF BETS ON FINTECH STARTUPS Citigroup as well as Goldman Sachs have been most active in funding fin tech startups globally. Fintech Deal Activity By Six Major Banks January 2009 – November 2015 18@cbinsights @cbinsights Source: https://www.cbinsights.com/blog/banks-record-fin-tech-investment/ #cbichain

19 FIN TECH UNICORNS AND
RISING The number of billion-dollar private companies within Fin Tech has grown to 19 valued in aggregate at $58.7B globally. 14 fall in either the lending or payments space. Global Fintech Unicorns By Valuation $B 19@cbinsights Source: https://www.cbinsights.com/blog/fin-tech-payments-lending-unicorns/ #cbichain

THE GROWING CROP OF FIN
TECH STARTUPS FOR MILLENNIALS FinTech startups targeting Millennials have attracted $3.7B in funding across more than 150 deals over the last five years. Whether in stock trading, consumer lending, personal savings or buying insurance, startups are innovating with the importance of this demographic in mind and investors are paying attention. 21@cbinsights Source: https://www.cbinsights.com/blog/fin-tech-startups-millennials/ #cbichain

THE UNBUNDLING OF A BANK
22@cbinsights Source: https://www.cbinsights.com/blog/disrupting-banking-fintech-startups/ #cbichain

BITCOIN AND BLOCKCHAIN HAVE DIVERGED
27@cbinsights Source: Magister Advisors Investor interest and general sentiment has diverged as initial VC enthusiasm for consumer bitcoin wallets, miners and exchanges has given way as banks, financial services firms, and other strategics look to invest in commercial applications of underlying blockchain technology. #cbichain

FUNDING TO BLOCKCHAIN/BITCOIN STARTUPS NOW
TOPS $1 BILLION 91% of all funding to the space has come since 2014. 60% has come since the start of 2015. 28@cbinsights *Through February 18, 2016 Total Global Funding to Blockchain/Bitcoin Companies 2009 - 2013 vs. 2014 – present* $93M $993M Funding between 2009 and 2013 Funding between 2014 and 2016 YTD #cbichain

FUNDING TO BLOCKCHAIN/BITCOIN STARTUPS HITS
ANOTHER RECORD HIGH IN 2015 Equity and VC funding to the blockchain and bitcoin space hit another record in 2015 at $494M. But deals have since fallen off from Q4’14’s high of 51 deals. 29@cbinsights Source: https://www.cbinsights.com/blog/fin-tech-periodic-table/ Financing Trend to Blockchain/Bitcoin Companies Q1’09 – Q4’15 #cbichain

2015 SAW A NOTABLE DROP
IN BLOCKCHAIN/BITCOIN SERIES A ROUNDS… 30@cbinsights Source: https://www.cbinsights.com/blog/fin-tech-periodic-table/ Blockchain/Bitcoin Deal Trend By Round 2013 – 2015 While there were three times as many mid-stage rounds to blockchain/bitcoin startups in 2015 on a YoY basis, 2015 saw a 44% drop in new Series A deals in the space. #cbichain

…BECAUSE THE ECOSYSTEM HAS EVOLVED.
SERIES A DEALS SHIFT AWAY FROM WALLETS, MINING & EXCHANGES 31@cbinsights Series A Deal Split: Blockchain vs. Bitcoin Jan 1, 2015 to Feb 18, 2016 Since the start of 2015, Series A activity has focused on companies working in areas such as APIs for blockchain applications, decentralized IoT technology, and issuance and trading platforms for smart securities Selectdeals Select deals #cbichain

THE MOST WELL-FUNDED BLOCKCHAIN/BITCOINCOMPANIES 32@cbinsights
Company Total Funding ($M) $116M $106M $44M Description $76M 21 Inc released the 21 Bitcoin Computer, a Linux- based hardware allowing developers to make bitcoin a core feature of products in September Coinbase is a bitcoin wallet and exchange, passing 2.4 million users in July 2015. Blockstream’s sidechain offering enables the creation of blockchains that can validate data and transfer assets to other blockchains. Circle Internet received a NY BitLicense in Sept. 2015 for its payments service but has distanced itself from bitcoin, publicly calling it ‘an enabling technology’ $76M Chain provides a blockchain developer platform for the enterprise market. Nasdaq selected Chain as a pilot partner to test blockchain technology for private market share trading. #cbichain

CORPORATE INVESTMENTS IN BLOCKCHAIN/BITCOIN STARTUPS
HIT RECORD HIGH IN 2015 2015 saw an explosion of corporation and strategic investment into the blockchain/bitcoin space, which rose 183% on a year-over-year basis. Corporate and Strategic Deal Activity to Blockchain/Bitcoin Companies 2012 - 2015 35@cbinsights #cbichain

MAY 2015: FEWER THAN 20
STRATEGICS AND CORPORATES INVESTED IN BLOCKCHAIN/BITCOIN STARTUPS The mix of strategic investors who had jumped into investing in blockchain/bitcoin startups by May 2015 included both tech (Google, Cisco, Qualcomm) and financial services (Goldman Sachs, NYSE, BBVA) giants. 37@cbinsights Source: https://www.cbinsights.com/blog/financial-services-bitcoin-investors/ #cbichain

FEBRUARY 2016: OVER 70 STRATEGICS
AND CORPORATES INVESTED IN BLOKCHAIN/BITCOIN STARTUPS Today, the pool of strategics invested in the blockchain/bitcoin space has expanded into insurance (AXA, New York Life, Transamerica), payments (Visa, MasterCard, AmEx), and telecom (Orange, Verizon). 38@cbinsights Source: https://www.cbinsights.com/blog/financial-services-bitcoin-investors/ #cbichain

THE MARCH OF FINANCIAL SERVICES
GIANTS INTO BITCOIN AND BLOCKCHAIN STARTUPS 13 financial services firms made their first investment in the digital currency and blockchain space between August and November 2015. Among the new financial services investors are insurance providers (TransAmerica, MSIG, New York Life), payments firms (Visa, MasterCard, AmEx) and banks (Citi, Santander, CIBC). First Investments By Financial Services Firms into Bitcoin/Blockchain Startups 39@cbinsights Source: https://www.cbinsights.com/blog/financial-services-corporate-blockchain-investments/ #cbichain

ALL OF 2015’S LARGEST BLOCKCHAIN/BITCOIN
DEALS INVOLVED CORPORATES AND STRATEGICS After no involvement in the five largest blockchain/bitcoin deals in 2013 and 2014, corporates have dominated the largest blockchain deals since the start of 2015. Funding to Top 5 Largest Bitcoin/Blockchain Deals By Corporate Involvement, 2013 – 2016 YTD 40@cbinsights #cbichain

“This is my personal opinion,
there will be no real, non-controlled currency in the world. There is no government that’s going to put up with it for long…there will be no currency that gets around government controls.” “You all have read about bitcoin, merchants, building their own networks, PayPal and PayPal look-alikes. Payments are a critical business for us – and we are quite good at it. But there is much to learn in terms of real-time systems, better encryption techniques and a reduction of costs and ‘pain points’ for customers.” 42@cbinsights Jamie Dimon Chairman & CEO, JPMorgan Chase Source: http://www.coindesk.com/jamie-dimon-bitcoin-will-not-survive/

GOLDMAN SACHS: “WHAT IF I
TOLD YOU THE BLOCKCHAIN COULD DISRUPT…EVERYTHING” 47@cbinsights Source: http://www.goldmansachs.com/our-thinking/pages/macroeconomic-insights-folder/what-if-i-told-you/report.pdf #cbichain

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